Gov. Blagojevich commends President Bush for releasing oil from Strategic Petroleum Reserve to bring down gas prices

CHICAGO - Governor Rod R. Blagojevich today commended President George W. Bush for his decision to help bring down the cost of gasoline by releasing additional oil supplies from the Strategic Petroleum Reserve.  Gov. Blagojevich sent a letter to the President on August 17^th, asking him to open the Reserve in order to bring down the prices of gasoline.  The Governor sent a second letter Monday renewing his call, in the aftermath of Hurricane Katrina's destruction.

 

"I am glad that the President heard our call and made the right decision to tap the Strategic Petroleum Reserve," said Gov. Blagojevich. "While Hurricane Katrina wreaked havoc on the Gulf States, we are also feeling her wrath at our gas pumps in Illinois.  The Gulf of Mexico produces approximately one quarter of our national domestic output of oil.  And, disruptions in oil shipments had a sudden and sharp impact on gas prices.  President Bush has the ability to save consumers money every time they fill up their tanks - and that's what he chose to do by releasing the Strategic Petroleum Reserve today." 

 

On Sunday, Hurricane Katrina halted an estimated 633,000 barrels of daily crude oil production, 42% of the daily average output from the Gulf Coast.  At least eight refineries with a combined capacity of 1.8 million barrels per day were also shut down, according to operators.  Monday morning, gas stations across Illinois increased their prices - in some cases as much as 40 cents to nearly $3 a gallon. 

 

Tapping the strategic oil reserve in response to a hurricane is not unprecedented.  Last year when Hurricane Ivan disrupted gas supplies, the government exchanged more than 5 million barrels of crude oil from the Strategic Petroleum Reserve.

 

In his letter sent Monday to President Bush, the Governor pointed out that in 2000, an oil swap was used to withdraw 30 million barrels over a 30-day period.  The move helped bring prices down by more than $6 per barrel and wholesale gasoline prices by $0.14 per gallon.  At that time, a barrel of oil cost $33.  Today, that same barrel of oil costs more than $67.

 

On Monday, the Governor also asked Attorney General Lisa Madigan to investigate price gouging at Illinois gas stations.  The Governor urged Illinoisans who suspect cases of price gouging to report their suspicions at www.illinois.gov/gasprices.  The gas prices monitoring website is part of the Governor's efforts to boost fuel supplies and help reduce the demand for gasoline which also include promoting the use of renewable fuel and encouraging State Government to use renewable fuels. 

 

Provided $80 million to further research, production and consumption of ethanol in Illinois, including:

·            Eliminated the state sales tax on some biodiesel fuels and E-85 (85% ethanol fuel), creating a $.15 per gallon tax break.

·            Established the Renewable Fuels Development Program at the Department of Commerce and Economic Opportunity that is investing millions in new ethanol production in Illinois.

·          Helped quadruple the number of E-85 fueling stations statewide to 70, with the goal of 100 E-85 stations statewide by the end of 2006. 

 

·        Issued an Executive Order ordering the Department of Revenue to monitor gas prices and created the Gas Monitoring Website www.illinois.gov/gasprices where people can:

o       Check average gas prices in any city or town in Illinois

o       File a complaint if they suspect price gouging

o       Get tips for buying gasoline

o       Learn driving tips to save fuel

o       Find information about public transit and other driving alternatives

o       Learn more about the petroleum industry

 

·        Issued Executive Order requiring state agencies and employees to use ethanol and biodiesel in state fleet vehicles and expanding the number of E-85 capable vehicles.

·        Created an interagency Renewable Fuels Working Group to implement the executive order.